Don't Trip Yourself up While Buying a Home

In the rush of excitement that comes with an accepted offer and a "yes" from the lender, many homebuyers make the mistake of taking their enthusiasm straight to the mall or appliance store. There still remain a few major hurdles to jump before the keys are handed over. Below you'll find a list of actions to stay away from during this crucial time of your home purchase.

Don't throw your money around. You may be itching to turn your new living room into a home magazine cover, or celebrate your new dream home, but stay away from expensive purchases like furniture, jewelry, appliances, or vacations until closing. You may send up red flags with your lender if you finance new furniture on your credit cards in the middle of your loan process. It's also a mistake to make those huge purchases with cash. Lenders are looking at your available cash when considering your loan.

Don't get a new job. Consistency in your work history is a good thing to lending institutions. Finding a new job (especially one with a better paycheck) may not jeopardize your ability to qualify for your mortgage loan. However, switching jobs during your application process could influence whether or not you are approved.

Don't move cash around or change banks. While your lender reviews your mortgage loan application, you will likely be instructed to submit bank statements for recent months on your checking accounts, savings accounts, money market accounts and other liquid assets. Your lending institution wants to see a steady rise and fall of your money over the pay period, in the interest of avoiding fraud. Even for practical reasons, moving around money or switching banks may make it harder for the lending institution to confirm your account history.

Don't give cash directly to your seller (commonly in the case of of "for sale by owner") to be used as a "good faith" deposit. As a rule, your good faith money is yours, not the seller's up until closing. Your good faith funds are to be applied to your expenses upon closing; some individual sellers might not know this. An attorney or other type of neutral party can hang onto your funds, or you may place them temporarily into a trust account until you close. The final disposition of good faith money, in the case of a failed transaction, should be included in the purchase agreement with the seller.

Amity Mortgage LLC can answer questions about these "Don'ts" and many others. Give us a call at 2037296681.